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Charities Reject Madoff Money
August 3, 2012
[ by Howard Haykin ]
Is Bernie Madoff’s name so radioactive that even his kin can’t give away their money? A Charitable Foundation was set up for each of Bernie's 2 sons, Andrew and Mark, and together they gave charitable donations totaling more than $250,000 to the Fidelity Charitable Gift Fund, but they were rejected and returned to the donors, according to tax records obtained through Guidestar, a nonprofit tracking service.
According to November 2011 tax filings, $176,000 was given by the Deborah and Andrew Madoff Foundation in December 2010, and $79,000 was given by the Mark and Stephanie Madoff Foundation. The donations fulfilled the Foundations' requirement to make annual distributions of 5% of the assets a year — or risk paying penalties and jeopardizing their tax-exempt status. Andrew's foundation held $3.5 million at the time, and Mark's held $1.9 million.
Two months later in 2011, Fidelity returned the Madoff money, filings show. While Fidelity declined to comment, experts said the brushoff was likely tied to fears that Madoff money — even charitable donations— wasn't worth it.
Clawback Potential. In 2010, Madoff trustee Irving Picard sued Andrew and Mark’s foundations for $2 million apiece. Picard argued the sons got their charitable entities off the ground with $2 million each of their pop’s sullied bucks. Dozens of charities that accepted the allegedly tainted cash could be at risk of clawbacks, experts said. Andrew Ehrlich, the lawyer representing the foundations, declined to comment.
Before Picard’s suits against the sons, Fidelity’s charitable arm accepted more than $450,000 from Andrew’s foundation in 2008 and 2009, records show. Andrew’s piano teacher, Erena Topchieva, received thousands of dollars from Andrew’s charity over the years, including $10,080 in 2009, records show. Topchieva said the money was for a scholarship fund for students who could not afford her lessons, and that it has since been discontinued.
She added that the scholarship was funded with money from romance publishing exec Walter Zacharius, a former student, who distributed it to her through Andrew’s foundation. "That money is not Andrew’s money, it is Mr. Zacharius’ money," she said. [C-I Note: Hmmm, wonder how she knows???]
To access the referenced story, go to: [NYPost, 8/2/12].

